TaxTMI 
TaxTMI 
2023 (9) TMI 736
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....ng the delayed receipts as unsecured loans advanced to the Associated Enterprises ("AEs") and thereby erred in imputing interest on the same. 4. The DRP/ AO/TPO erred in treating the delayed receivables as a separate international transaction, although the same does not fall within the purview of "capital financing" in terms of Section 92B of the Income- tax Act, 1961 ("the Act"). 5. The DRP/AO/TPO ought to have appreciated that the receivables emanating out of the principal transaction of rendering services, the same ought to, if at all, be benchmarked in an aggregate manner with the said services. 6. The DRP/AO/TPO erred in imputing interest on the outstanding receivables from AEs, without appreciating that the Appellant followed the same policy of not charging any interest on the receivables from non-AEs. 7. The DRP/AO/TPO erred in not appreciating the fact that the Act provides for taxing only real income whether received or accrued under the regular provisions and does not provide for taxing notional income. 8. The DRP/AO/TPO erred in not appreciating the fact that TP adjustment cannot be made on hypothetical and notional basis unti....
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....its AEs. For year under consideration, the assessee filed the return of income on 30.03.2018, declaring total income of Rs. 39,82,64,080/-. The case was selected for scrutiny under CASS and statutory notices u/s. 143(2) and 143(1) were issued and served on the assessee. 2.2 The Ld.AO noted that, the assessee had international transaction exceeding Rs. 15 crores and therefore reference was made to the Ld.TPO for computing the arms length price of such international transactions. The Ld.TPO upon receipt of the reference, called for the economic analysis in respect of the international transactions in form 3 CEB. It was noted that, the assessee had undertaken following international transactions: International Transactions Amount As per Form No. 3CEB (Amount in INR) Provision of Software Development Support services 2,45,87,45,842 Provision of technical call centre services (ITES) 29,75,29,568 Provision of marketing support services (MSS) 10,40,06,090 Deemed International transaction 1,59,10,672 Not an international transaction - disclosed in Form No. 3CEB on abundant caution basis Unearned Revenue 6,69,41,648 Year end balances (Receivab....
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....ment order by making following additions in the hands of the assessee. Total income as per ITR Rs. 39,82,64,080/- Add: TP addition u/s 92CA Rs. 7,87,77,217/- Add: Disallowance u/s 80G Rs. 5,50,000/- Add: Disallowance u/s 40A(7) Rs. 1,84,63,980/- Rs. 9,77,91,197/- Total Rs. 49,60,55,277/- Or Rs. 49,60,55,280/- Aggrieved by the order of the Ld.AO, assessee is in appeal before this Tribunal. 6. At the outset, the Ld.AR submitted that the only issue alleged by the assessee under transfer segment provisions are in respect of the computation of notional interest on outstanding receivables. 6.1 He submitted that ground nos. 2-12 are in respect of this issue and this issue stands covered by assessee's own case for A.Y. 2016-17 passed in IT(TP)A No. 268/Bang/2021 by order dated 28/11/2022. The Ld.AR submitted that all the contentions of the assessee has been addressed therein by adopting the LIBOR rate + 200 basis points. 6.2 On the contrary, the Ld.DR relied on the orders passed by the authorities below. We have perused the submissions advanced by both sides in the light of records place....
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....st American (India) Pvt. Ltd. vs. ACIT in ITA No. 1762/Bang/2019 by order dated 29.04.2020. In assessee's own case, this Tribunal has observed and held as under: "68. The learned AR submitted that the amount of donation made has already suffered a disallowance under Section 37 of the Act. If a further disallowance is made under Section 80G of the Act, more so in view of such claimed not being prohibited by the said section, it would lead to double disallowance. Therefore the disallowance made by the Assessing Officer ought to be set aside. The learned AR placed reliance in this regard is placed on the decision of coordinate bench of the Tribunal in the case of First American (India) Pvt. Ltd. v. ACIT (Order dated 29.04.2020 passed in ITA No. 1762/Bang/2019). 69. We heard the rival submissions and perused the material on record. We notice that the impugned issue has been considered by the coordinate bench in the case of First American (India) Pvt. Ltd (supra) where it has been held that - We have perused submissions advanced by both sides in light of records placed before us. 11. Section 135 of Companies Act, 2013 requires companies with CSR ob....
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....ollowing sections. • Section 30 provides deduction on repairs, municipal tax and insurance premiums. • Section 31, provides deduction on repairs and insurance of plant, machinery and furniture • Section 32 provides for depreciation on tangible assets like building, machinery, plant, furniture and also on intangible assets like know-how, patents, trademarks, licenses. • Section 33 allows development rebate on machinery, plants and ships. • Section 34 states conditions for depreciation and development rebate. • Section 35 grants deduction on expenditure for scientific research and knowledge extension in natural and applied sciences under agriculture, animal husbandry and fisheries. Payment to approved universities/research institutions or company also qualifies for deduction. In-house R&D is eligible for deduction, under this section. • Section 35CCD provides deduction for skill development projects, which constitute the flagship mission of the present Government. • Section 36 provides deduction regarding insurance premium on stock, health of employees, loans or commission for empl....
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....8. We therefore do not agree with arguments advanced by Ld.Sr.DR. 19. In present facts of case, Ld.AR submitted that all payments forming part of CSR does not form part of profit and loss account for computing Income under the head, "Income from Business and Profession". It has been submitted that some payments forming part of CSR were claimed as deduction under section 80G of the Act, for computing "Total taxable income", which has been disallowed by authorities below. In our view, assessee cannot be denied the benefit of claim under Chapter VI A, which is considered for computing 'Total Taxable Income". If assessee is denied this benefit, merely because such payment forms part of CSR, would lead to double disallowance, which is not the intention of Legislature. 20. On the basis of above discussion, in our view, authorities below have erred in denying claim of assessee under section 80G of the Act. We also note that authorities below have not verified nature of payments qualifying exemption under section 80G of the Act and quantum of eligibility as per section 80G(1) of the Act. 21. Under such circumstances, we are remitting the issue back to Ld.AO f....